Sansad TV: India-Russia Trade Relations | Current Affairs & Hindu Analysis: Daily, Weekly & Monthly - UPSC PDF Download

Introduction

India and Russia are currently engaged in advanced negotiations for a new Bilateral Investment Treaty, according to the External Affairs Minister, S Jaishankar. While acknowledging the strong and steady relationship between the two countries, Dr. Jaishankar emphasized the need to address the trade imbalance with Russia. The bilateral trade volume has reached $45 billion this year, primarily driven by India's increased purchases of Russian crude oil. India is now exploring opportunities to boost its exports to Russia across various sectors.

• Eastern Economic Forum: The Eastern Economic Forum was established in 2015 by President Vladimir Putin with the aim of supporting economic development in Russia's Far East and promoting international cooperation in the Asia-Pacific region.

The Far East

• The Far East region of Russia is located in the easternmost part of the country. It shares borders with two oceans, the Pacific and the Arctic, as well as five countries including China, Japan, Mongolia, the United States, and the DPRK.
• Covering an area of 6.952.555 km2, the Far East accounts for approximately 41% of Russia's total land area, making it the largest federal district. In recent years, the region has experienced significant development, facilitated by unique mechanisms such as Advanced Special Economic Zones that aim to create a favorable investment climate. 
• The Far East is known for its abundant natural resources, including diamonds, stannary, borax materials, gold, tungsten, and fish and seafood, with substantial percentages of these resources being extracted in the macro-region.

Why is Russia Important for India?

• Prime Minister Modi has described the EEF as a “historic opportunity” to give new impetus to the cooperation between India and Russia.
• India is interested in expanding the level of trade between the two countries. An area of special interest for India is the exploration of hydrocarbon reserves along the coast of Russia’s Far East
• Even as India is diversifying its defense trade partners, Russia still dominates the Indian defense inventory to the tune of about 70 per cent.
• Russia remains the only partner that is still willing to give India critical technologies, such as a nuclear submarine.
• Russia also reaffirmed its “unwavering support” to India for a permanent seat in an expanded UN Security Council.
• Russia expressed its support for India’s membership of the Nuclear Suppliers Group.
• Both countries have mutual benefits in supporting struggle against terrorism, Afghanistan, climate change; organisations like SCO, BRICS, G-20 and ASEAN.

Economic ties:

• Russia-India trade has not grown to great heights despite the encouragement of both states.
• Russia sees India – one of the fastest growing economiesin the world – as a country that could alleviate Russia’s economic problems.
• Make in India initiative has welcomed Russian companies from the public and private sectors.
• Indian companies are exploring major investment options in Russia, especially in natural resources such as coal, fertilizers, hydrocarbons, minerals, and rare earth metals.
• Trade and investment relations are not up to the mark and this needs improvements.

Issues of terrorism

• Both countries unequivocally condemned terrorism in all its forms and emphasized the importance of a global collaborative approach in combating this menace effectively. They also called for the complete eradication of terrorist "safe havens," with a presumed reference to Pakistan. India openly expressed its shared concerns with Russia regarding developments in Syria.

Cultural Cooperation

There exists a strong tradition of Indian studies in Russia, with Russian institutions offering courses on various Indian languages such as Hindi, Tamil, Marathi, Gujarati, Bengali, Urdu, Sanskrit, and Pali. The Russian people display a general interest in Indian dance, music, yoga, and Ayurveda. Regular cultural initiatives are undertaken to foster people-to-people connections between India and Russia.

Way Forward

The India-Russian relationship is currently in an intriguing phase, but there are bilateral challenges that need to be addressed. Sustaining the relationship will depend on defense deals and nuclear energy cooperation. India should leverage its strengths and shared concerns with Russia and work towards attracting Russian investors to explore opportunities in India's infrastructure sector.

Conclusion

• India and Russia have identified various new areas of cooperation, including deep sea exploration, building knowledge-based economies focused on science, technology, innovation, robotics, and artificial intelligence. The emphasis is on infrastructure, skill development, agriculture, shipbuilding, railways, aviation, and enhanced connectivity, particularly people-to-people interactions.
• By actively engaging with the "Act Far East" initiative, India can demonstrate its commitment to addressing Moscow's concerns, thereby assuring its long-standing partner that India is capable of navigating multiple alignments, even when they diverge from one another in an increasingly polarized world.